The European Investment Bank’s (EIB) Vice President Vazil Hudak signed the European Investment Advisory Hub (EIAH) and Hungary’s Development Bank (MFB) agreement to explore the feasibility of creating an investment platform focussed on smart cities and transport in the central European country.

“Smart cities are particularly important as future hubs of investment and talent, with impact on growth and jobs in the economy. For the EIB, smart city and regional investment is a way to respond efficiently to our social and territorial cohesion mandate by supporting the upgrade of local economies in a quickly evolving digital world”, addressed VP Hudak during the opening speech of the EIAH Days in Budapest. “The investment platforms can play an important role in facilitating better access to finance, through the aggregation of projects that would otherwise be too small or too risky to access the finance needed. With this flexible concept, I believe we can identify together with MFB strong pipeline for the investment platform, to finance a number of smart investment project in Hungary."

The EIB’s investment survey (EIBIS) has helped to identify existing investment gaps and opportunities for smart city investments in Hungary. The agreement signed today, will enable EIB to examine the extent that an investment platform could help to address the investment gaps identified.

Investment platforms seek to combine resources under the European Fund for Strategic Investments (EFSI) with private and public funding. They are a means by which smaller and higher risk projects can be aggregated to attract the financing they need. Our ambition is to identify financing solutions that meet the needs of smart city investment, thanks to full utilisation of the bank’s financial capacities in addition to the advisory support provided by the European Investment Advisory Hub (EIAH).

Separately on Thursday, the bank and Hungary’s economy ministry signed a nearly EUR100 million project supporting investment plans of Budapest’s University of Sport Sciences and Physical Education (USSB) and University of Pécs, designed to increase quality of teaching, research and learning facilities.

The enhanced university facilities will attract an increasing number of home and foreign students, thereby having a positive effect on the innovation capacity of the country and impacting positively growth opportunities

Unlocking Smart Cities’ potential

Financing smart cities in Central and Eastern Europe (CEE) cities show large, untapped potential for growth and development. In many areas, city productivity is below the EU-28 average and smaller cities are lagging behind the capitals in terms of economic growth. Smart investment can address existing infrastructure gaps as well as unlock innovative potential. With EIB support there is now a new momentum driving smart city developments across the region. Furthermore, the EIB is working on new ways to support smart city investment in the CEE region.

With the support of the European Investment Advisory Hub, the EIB is exploring the potential to create a dedicated smart cities investment platforms in numerous member countries, including Hungary.

Background information:

The European Investment Advisory Hub (EIAH or the Hub) is one of the elements of the Investment Plan for Europe (IPE) an initiative by the European Commission and the European Investment Bank which aims to revive investment in strategic projects around Europe to ensure that money reaches the real economy.

The Hub offers a single point of entry to advisory and technical assistance services for investment projects in the EU, building upon the expertise of the EIB Group, the European Commission, National Promotional Institutions (NPBs) and Member States’ Managing Authorities. Moreover, the European Investment Advisory Hub aims to enhance cooperation with and between existing and newly established NPBs. The Hub supports projects which may be eligible for financing by the EIB (either under EFSI or otherwise), but the advisory support available under the Hub is not limited to EIB-financed projects.

Background info on EIAH Roadshow:

The hub is organising a series of events in target countries in collaboration with its network of local partners. Similar events have been organised so far in Slovenia, Bulgaria and Poland. The next EIAH Roadshow event, after Hungary will be in Croatia on 6 March and then in Slovakia on 12 March. The objective of the EIAH roadshow events is to inform and share knowledge with local partners and stakeholders on topics which are relevant and important in each country, as well as to encourage generation of new project proposals. The events will target the following countries which have been identified by the “Market gap analysis for advisory services under the EIAH” as having the greatest advisory service need: Bulgaria, Croatia, Hungary, Lithuania, Latvia, Poland, Romania, Slovenia, and Slovakia.